Introduction
1.0 Background To The Study
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1.1 Statement Of The Problem
Cost-volume-profit (CVP) analysis is a managerial tool and can be used to achieve corporate profitability in any organization. Cost-volume-profit (CVP) analysis is a tool that can be used in firms that are faced with problems having cost, volume and profit implications.
It is a true fact that certain cost elements of a firm not only vary but are usually large in proportion e.g. material and labour. Therefore, the main concern of this research study is to profer solution to the following problems:
- Non-employment of sales value in the determination of profitability in firms.
- Lack of relationship between sales value and total cost of firms.
- Non-incorporation of sales value in investment decision in firms.
- Inadequate financial data for cost and profit analysis in firms.
1.2 Objective Of The Study
This research study will be focused on cost-volume-profit analysis and profitability target (A survey of some selected firms listed in Nigerian Stock Exchange). The main objective of this study are as follows:
- To determine the effect of sales value on the profitability in firms.
- To know the relationship between sales value and total cost of firms.
- To make provision for the incorporation of sales value in investment decision of firms.
- To justify the need for adequate financial data for cost and profit analysis in firms.
1.3 Research Questions
- What is the effect of sales value on profitability in firms?
- What is the true relationship between the sales value and total cost of firms?
- How will firms incorporate sales value in making investment decision?
- Why is there financial data inadequacy for cost and profit analysis in firms?
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